Volatility
The degree of price variation in a given period — high volatility = big swings, low volatility = quiet markets.
Definition
Volatility is measured in absolute terms (pips, dollars) or relative (%, standard deviations). It expands and contracts in cycles — quiet periods often precede explosive moves and vice versa.
FX volatility varies by pair (exotics > minors > majors), session (London/NY overlap is the busiest), and event (news releases spike volatility briefly then revert).
Example
EUR/USD daily ATR(14) typically runs 50–80 pips. GBP/JPY runs 100–200 pips. Same percentage move = different dollar swing.